Fitch eyes Smurfit Kappa positively

Fitch Ratings said it placed Smurfit Kappa Group plc’s long-term issuer default rating of BBB- on rating watch positive.

The RWP follows SKG's announced merger with WestRock Co. in a stock-for-stock deal, Fitch said.

“Fitch believes Smurfit WestRock will continue with a similarly conservative financial policy as SKG. While we expect slightly higher combined EBITDA net leverage post-transaction than at SKG currently, we nonetheless expect it to remain strong. This, combined with the stronger business profile, is likely to lead to a one-notch upgrade to BBB on resolution of the RWP. Fitch will resolve the RWP once the merger is completed, expected in 1H24,” the agency said in a press release.

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